PMJ INTERNATIONAL LIMITED

1. Risk Rating: LOW

Justification: PMJ International Limited demonstrates a stable financial trajectory characterized by consistent organic growth in shareholder funds over the past five years. The company is solvent, with net assets increasing from £48.4k in 2019 to £98k in 2025, and maintains a healthy liquidity position with a current ratio of approximately 1.55x. Regulatory compliance is strong, with all filings up to date and no overdue accounts.

2. Key Concerns

• Key Person and Concentration Risk: The company is highly concentrated within the Johnson family, with Paul Mark Johnson and Jamie Mark Johnson serving as the only directors, and the PSC register indicating that control is split between Paul and Sandra Johnson. With an average employee count of just five, the business is highly vulnerable to operational disruption if any of the key individuals become unavailable.
• Fully Depreciated Tangible Assets: The balance sheet shows £0 in tangible fixed assets for both 2024 and 2025, following the disposal of £13.7k of plant and equipment in the current year. While the company operates in equipment repair (which can be labor-intensive rather than asset-heavy), a nil carrying value suggests that the existing operational equipment is fully depreciated and may be aging, which could necessitate near-term capital expenditure to maintain service capabilities.
• Trade Debtor Reliance: Trade debtors stand at £85.2k, representing roughly 31% of total assets. While typical for B2B operations, a significant portion of the company's value is tied up in unpaid invoices rather than cash or physical assets, exposing the firm to potential bad debt or cash flow delays if customers default.

3. Positive Indicators

• Strengthening Balance Sheet: Net assets have grown year-on-year, increasing from £79.3k in 2024 to £98k in 2025. The P&L reserve has similarly expanded from £79.1k to £97.8k, indicating consistent, retained profitability without the need for external equity injections.
• Effective Liability Management: The company has successfully reduced its current liabilities from £205.6k to £178.3k, driven largely by a significant reduction in trade creditors (down from £123.4k to £98k). This demonstrates an ability to generate cash from operations to pay down supplier balances.
• Regulatory Compliance: The company is fully compliant with Companies House filing requirements. Accounts are filed on time, the confirmation statement is up to date, and the company has utilized the small companies' exemption from audit appropriately.

4. Due Diligence Notes

• Skipton Business Finance Charge: Note 6 to the accounts references an outstanding fixed and floating charge with Skipton Business Finance Limited. Further investigation is required to determine the original loan value, the current outstanding balance (which appears to be the £9.8k listed under bank loans), and any associated covenants that may restrict dividend distribution or further borrowing.
• Debtor Aging: An analyst should request an aged debtor report to assess the collectability of the £85.2k trade debtor balance, ensuring that this asset is not inflated by long-overdue or disputed invoices.
• Capital Expenditure Strategy: Given the nil net book value of tangible assets, discussions with management are recommended to understand their capital expenditure pipeline. It is important to ascertain if the lack of asset value reflects a shift to a more labor/outsourcing-based model, or if the existing equipment is simply fully depreciated but still functional, which could mask future replacement costs.
• PSC Data Discrepancy: The PSC register lists "Mrs Sandra Johnson" twice with identical shareholding and voting rights. This should be clarified to confirm the exact ownership structure and ensure there is no administrative error or undisclosed trust arrangement.